NEW YORK - The Johnson Redbook Retail Sales Index was up 2.8% in the second week of January following a 3.3% gain in the previous week. Month-to-date, January was up 3.1% compared to January of last year (relative to a target of a 2.9% gain). Month-over-month showed a 1.4% drop compared to December (relative to a target of a 1.6% drop). January is a four-week month on the retail calendar, ending on January 28th.

Sales cooled off in the second week as consumer appetite for clearance bargains became partially satiated and year-end clearance dominated sales activity. Department stores are typically volatile in January as they work thorough the annual clear out of winter inventory and drive sales through pricing. Discount stores, on the other hand, returned to a more normal environment with business in consumer basics and food. Sales leader lists varied widely from store to store, fairly typical of a transitional, trend-less month. Some stores have reported increased business in cold weather apparel in response to lower temperatures in many parts of the country. At the same time, retailers don't read too much into the month, since January is considered a transitional month with low volume business driven by price markdowns and focusing on shifting goods to make room for Valentine's Day and spring lines.

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